Steel major JSW Steel net profit for the September quarter dipped 85% year on year on account of declining revenues, and a one-time exceptional cost of Rs 342 crore, the company said on Friday.
The company has made a net provision of Rs 342 crores pertaining to the underlying carrying value of the assets including inventory and site restoration liability on account of the surrender of the Jajang Iron Ore mine located in the district of Keonjhar, Odisha under exceptional items.
Net profit for the fiscal second quarter was Rs 404 crore, as compared toRs Rs 2,773 crore in the same period last year.
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Revenue for the quarter was down 11% at Rs 3,964 crore while earnings before interest, taxation, depreciation and amortisation (EBITDA) at Rs 5,437, was down 31%. EBITDA margin expanded to 13.7% on-year and PAT margin for Q2FY25 was 1.1%.
The company missed Street estimates on revenue (estimates: Rs 42,560 crore) and PAT (estimates: 485 crore), though it beat EBITDA estimates of Rs 5,051 crore on account of better inventory credit and a decline in other expenses.
Consolidated crude steel production for the quarter was 6.77 million tonnes, up 7% year on year while JSW Steel’s capacity utilization at its Indian operations improved to 91% in Q2 after the completion of planned maintenance shutdowns at Dolvi and BPSL in Q1.
Steel sales for the quarter stood at 6.13 million tonnes, down 3% annually, on account of a 43% dip in exports due to elevated Chinese exports. However, domestic sales at 5.57 million tonnes were the highest in any quarter, up 1% on-year, the company said. Exports constituted 7% of sales from the Indian operations for Q2 FY25 versus 10% of sales in Q1 FY25.
“China’s elevated steel exports at 84mt (up 21% YoY) between January and September has dampened global steel prices and margins,” the company said in its earnings statement.
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